5 Things You Need to Know About Individual Fundraising

by Joe Garecht

Individual fundraising (raising money from individuals) should form the backbone of 90% of all development organizations that exist today. All types of fundraising are important to carrying out your mission, and none can be discounted, but non-profits that can successfully rely on events, direct mail, or grants are the exception, not the rule, and generally are national, not local in scale. For most small and mid-sized non-profits, individual fundraising will provide a major portion of your fundraising revenues.

Here are five things that every charity should know to maximize their individual giving program:

1. You’ve got to have a Plan

Every single aspect of your development operation starts with a plan. Many small non-profits have a general fundraising plan, but not a specific individual giving plan. This is a mistake that will ultimately result in confusion and missed opportunities. Before beginning or continuing your individual fundraising efforts, write out an individual giving plan.

2. Individual Fundraising is Viral

Raising money from individuals works best when you utilize viral fundraising. Think of your organization’s development efforts as a set of concentric circles. Your organization is in the middle. Your donors are in the next circle – go back to them, cultivate them, get them to help. Your donors’ contacts are in the next circle – develop relationships there, ask for funding, then ask these new donors to introduce you to their rolodex… keep working outward. Build fundraising networks. Fundraise virally.

3. Relationships Matter!

People give more money when you build a relationship with them. Nowhere is this truer than in major donor giving. Work to build relationships with your donors and with your prospects. Visit them. Keep them updated and involved. Show them you appreciate them.

4. Involvement Goes Beyond Giving

Some schools, churches, and charities think that individual donor involvement stops when the check gets written – take this approach and I guarantee you will leave money on the table. Most donors who give to your organization do so because they want to be involved. As a development professional, it is your job to get them involved beyond just writing a check. Help your donors and prospects volunteer, learn, network, and come to events. Get them connected more deeply with your group, and they will continue to give.

5. Your Mission must take Center Stage

While individual fundraising relies on many factors – your board’s contacts, your donors’ networks, your staff’s fundraising abilities, and your marketing material’s quality – none matters more than your mission. Many organizations lose sight of this simple fact. Ultimately, more people give because of your mission than any other single reason. Make sure that your group’s mission takes center stage in your individual fundraising campaigns, and in all of your development efforts.

I had a question related to individual gift-giving. If a person wanted to raise money for a cause or project on their own, without being affiliated with a business or non-profit, is there a limit to how much can be raised? I had read that there is a $25,000 if you are an individual trying to raise money. Is this so?

Thanks for your comment – If you want to raise money for a cause of project on your own, make sure you get in touch with the non-profit that will be spending the money and coordinate with them. In order for the donations to be tax-deductible for the donors and not incur tax for you, they have to be made (i.e. the checks need to be written) to an organization that holds non-profit status with the government.

Generally (depending on where you live) there are not limits on how much you can raise for a non-profit.

It depends where you live and how you are raising the money. Remember, in most places you need to be a registered non-profit in order to allow those who give to you to get a tax deduction in return, and also for you not to have to pay taxes on the money as income. Alternately, you can work with a non-profit or church that supports your efforts and the money can be donated to them and used for a charitable purpose you both agree on, if allowed by law in your country.

Hello Joe
I am trying to start a fundraiser for as a nonprofit but it would be more torwards different things then say cancer or singular stuff. I live in texas and really believe in this vision I have. I just would like to know how to do this.

I am on the board of our Michigan elementary school PTO. Our organization is registered as a 501 c3 and has tax exempt status. We have a teacher who has an infant son with cancer. Some parents wanted to run private fundraisers and use the PTO for handling the money. However, I was under the impression that since we are set up for educational fundraising, we are not allowed to direct money to an individual. Is this true? If so, what should I tell the parents to do to properly set up the fundraiser?

Thanks for your question. Kudos on being involved with the PTO and for wanting to help one of your teacher’s son who is facing a difficult situation. My best advice here is to talk to the accountant for your PTO, or another qualified accountant or tax attorney who deals with non-profit issues to get good solid guidance. Your question is a good, but complicated one, and you’ll need to get professional guidance before you proceed.

I feel God is leading me to work for a non-profit organization that needs people with the specific skills and training that I have. This however would eventually be full time and I would have to raise my own funds to provide for my wife and children. Do you have any advice on how to get started on such a task?

The place to start is with your own network of family, friends, colleagues, coworkers, etc. – Tell them what you are doing and why, and ask them to help you achieve your goal by committing a monthly donation to the non-profit, which will be used to pay your salary, etc. Be open and transparent with your donors about the use of funds, as well as the mission of the organization. Hundreds of thousands of people worldwide use personal fundraising like this to work for non-profits and ministries in various service areas. Then, once you have a base of support, you can stay in regular contact with your donors and over time, they will introduce you to new donors that you can add to your support list.

Hello Joe,
I was wondering if it is possible for one person (me) with a few friends (if they agree to help) to raise money for another friend who wishes to go to college but cannot afford to pay for it? If possible, can it be done in about 6 months or so?

Hi Joe,
I am a parent and would like to sponsor a fundraiser for the teachers son (mentioned above). We will raise less than 5,000 most likely. Do I need to set up a non profit account or can I set up a paypal account with the fundraiser name ? Thanks

Have you looked into using an crowdfunding site like GoFundMe that is set up specifically for small, friend-to-friend fundraisers like this? If you plan to do the fundraising offline, I would start by approaching a local community bank, telling them what you want to do, and seeing if they can help with setting up the right type of account.

My daughter just made the pom squad, I was quick to find out how expensive it is going to be. They have some small fund raisers but my daughters needs to raise around $4500 for the entire year. She is going to take this head on but I would love some ideas on the best way to approach this.

Thanks for your question. The best way to raise money for this type of effort is to reach out to friends and family to ask them to sponsor your daughter. Perhaps you can ask people on your holiday card list to donate $10 per month / $120 per year to sponsor your daughter? Then your daughter can supplement by holding a bake sale or small event for friends and family? It really is best to start with people who already know your family.

Good afternoon,
Myself and four other ladies are having a small event (in Virginia) that includes a bake sale, games and other activities were we are asking for donations to participate in said activities, all money that we raise will be donated to a charity that we have chosen to donate too. Do we need to register with the state. We are not looking to raise no more than $1000, if that.

Thanks for your question, and best of luck with your upcoming fundraiser. Your best bet is to check with the state directly, or with a qualified local accountant. Alternately, you could select a charity in advance and partner with them and they will be able to make sure you are staying within the proper regulations for your state.

I work in a heavy labor outdoor job in South GA, and at the workplace we have setup a unofficial fridge fund of sorts. It is just funded by donations of the coworkers, what I would like to know is if we setup a card reader “like pay pal/square” would we have to report it on someone’s taxes?

I’m not sure about the tax issue – you should check with an accountant, perhaps your company’s accountant would be willing to answer the question for you. I do think you would be able to use PayPal or Venmo or another app/card reader for this, but you’ll need to double check.

Dear Joe, you have provided such great advice to others and I hope you could give me some insight. I have a friend who is planning a Style Show to raise money for a local orphanage. Specifically, the kids who age out at 18 who need a little extra to get them on their way. He does not know how to go about handling the donations. He has a committe helping with the plan and has businesses donating the place and the fashion. He will need makeup artists, lighting experts and photographers but he would like to pay them a discounted price for their time. The orphanage is on board. Could he handle the money/donations and at the end give a check to the orphanage minus the expenses. I understand that as an individual he cannot tell those donating that they can use it as a tax deduction if checks are made out to him, correct? Could he give them a receipt stating the amount & what the donation is for (the orphanage name) and tell those individuals to check with their accountant. I suggested he go to his bank and open a separate account for the donations. Sorry but he asked to help him research this before his first meeting. It’s beyond me! Lol
thank you

We have a booster organization in OH that is registered as non-profit and has a 501c(3). We are wanting to work at local sporting events and have a few other volunteering opportunities from other venues. We also would like to track the fundraising figures raised by each athlete. The reason for this is that the parents for “Sally” may only need to fundraise twice per month to assist with her cheer fees. “Suzy” may need her parents to work 15 as her cheer fees are more expensive because of on what team(s) they are on.

Are there any ways that this can be accomplished? I don’t think that parents will want to (or may be unable to) work to help pay for other kids fees when they may need very little help at all.